Correlation Between ANGANG STEEL and Hochschild Mining
Can any of the company-specific risk be diversified away by investing in both ANGANG STEEL and Hochschild Mining at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining ANGANG STEEL and Hochschild Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANGANG STEEL H and Hochschild Mining plc, you can compare the effects of market volatilities on ANGANG STEEL and Hochschild Mining and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in ANGANG STEEL with a short position of Hochschild Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANGANG STEEL and Hochschild Mining.
Diversification Opportunities for ANGANG STEEL and Hochschild Mining
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ANGANG and Hochschild is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding ANGANG STEEL H and Hochschild Mining plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hochschild Mining plc and ANGANG STEEL is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on ANGANG STEEL H are associated (or correlated) with Hochschild Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hochschild Mining plc has no effect on the direction of ANGANG STEEL i.e., ANGANG STEEL and Hochschild Mining go up and down completely randomly.
Pair Corralation between ANGANG STEEL and Hochschild Mining
Assuming the 90 days trading horizon ANGANG STEEL H is expected to under-perform the Hochschild Mining. In addition to that, ANGANG STEEL is 1.37 times more volatile than Hochschild Mining plc. It trades about -0.23 of its total potential returns per unit of risk. Hochschild Mining plc is currently generating about 0.13 per unit of volatility. If you would invest 258.00 in Hochschild Mining plc on October 14, 2024 and sell it today you would earn a total of 11.00 from holding Hochschild Mining plc or generate 4.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ANGANG STEEL H vs. Hochschild Mining plc
Performance |
| Timeline |
| ANGANG STEEL H |
| Hochschild Mining plc |
ANGANG STEEL and Hochschild Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANGANG STEEL and Hochschild Mining
The main advantage of trading using opposite ANGANG STEEL and Hochschild Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANGANG STEEL position performs unexpectedly, Hochschild Mining can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Hochschild Mining will offset losses from the drop in Hochschild Mining's long position.| ANGANG STEEL vs. PTT Global Chemical | ANGANG STEEL vs. Sanyo Chemical Industries | ANGANG STEEL vs. Mitsubishi Gas Chemical | ANGANG STEEL vs. INTERSHOP Communications Aktiengesellschaft |
| Hochschild Mining vs. Xiwang Special Steel | Hochschild Mining vs. DONGJIANG ENVIRONMENTAL H | Hochschild Mining vs. AeroVironment | Hochschild Mining vs. ANGANG STEEL H |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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